Research conducted by MarketingWorks and Reading University uncovered the real cost of the bidding process in the construction industry as almost £3 billion.
myConsole, recently announced as the procurement partner for Digital Construction Week, will be holding a webinar to show the industry how they can dramatically reduce these costs.
The research discovered that the bid cost works out to 0.57% of the project value. When you add together the amount spent on winning and losing bids in the £110 billion construction industry, the total hits almost £3 billion.
“The bidding process often escapes serious scrutiny and analysis. Our research highlights that this needs to change. The potential for efficiencies and savings in time and money are massive,” said Philip Collard, Chief Executive of myConsole.
Most tellingly, there are a range of work winning behaviours that mark out winning bidders. In their webinar, myConsole will highlight the areas ripe for change in the bid process.
Key takeaways from the session will include insights into:
- Relationship building
- Bid selectivity
- Process management
The traditional approach to winning work is for teams to spread their resources over a large number of bids. The research shows the average number of bidders per tender is five, which aligns with the typical length of a tender list - between four and six.
Philip Collard explained how this impacts on the cost of bidding. “We discovered the true cost for a winning bid is the cost of four losing bids, plus the cost of the winning bid. This brings the cost of the bid process up to a staggering 2% to 3% of total revenue.”
“We have valuable insights into the behaviour and processes that win work, and can help procurement teams create massive efficiencies,” said Philip.
Tune into the myConsole webinar on 1st June at 2pm. Register here to find out more.